How To Negotiate Your Mortgage Rate

By Jim Thorpe


Getting a great mortgage rate, especially when it comes to constructing your own house, can take some investment and time. Not only do you have to invest time but you need to understand what you are doing.

1. Before You Need It The best time to start preparing for a great mortgage is before you need it. There is a very good change that you will not rent your whole life and a pretty good chance you will not pay $400,000 cash. With the knowledge that you will eventually need it there are a number of steps that you need to take.

Fortunately, homes can be restored or rebuilt with the right general contractor and damaged items can be replaced. Unfortunately, the lives of the people in your home are not restorable or replaceable.

Standing in the doorway was an animal control police officer. "Do you smell that natural gas?" he asked. "Well, now I do. I couldn't smell it before I opened the door." "Well, I'm going to take a look around. Is anyone else at home?" "I've got two small kids here with me." "Okay. Stay inside and I'll let you know what I find."

3. Call Around You should be calling around and finding your loan before you have begun looking at houses. This gives you more time to negotiate with banks and reduce the pressure you may feel. Now that you are actively seeking a deal you need to 4-5 different lenders. Call these different lenders and act for different quotes. In order to get the most accurate quotes from lenders you need to give them the most accurate information.

The USFA believes strongly that the routine maintenance of your fire alarm could protect more lives than just those of those in the home, and reducing fatalities from fire damage is the USFA's number one goal.

4. Compare Quotes Take all of the information that you have collected from the lenders and set them next to each other. The lenders should also have sent you a GFE (Good-Faith-Estimate) and a TIL (Truth in Lending). The TIL amortizes the costs of the loan over the life of the mortgage rate. It takes theses costs and adds them to the interest rates giving you your APR (Annual Percentage Rate).

On the third page of the GFE document there is space for you to compare your different loans and see what your different options include. Again you want to compare accurate information not commercials. Mortgage rates in commercials are showing rates that will only be offered by the ideal borrower.

Alarms that you know are working save lives. They give you proper warning. In contrast, two or three alarms you assume work that are scattered around the house endanger them.

Ultimately the fire fighters found the leak outside the home, checked the home to make sure it was safe to be inside, and called the gas company to come out and fix the line. (After their initial inspection of the leak on the day of, they didn't fix until a week later. But that's another story for another day.)

6. Authorize and Sign After having looked at all of the details you are ready to make your decision. If the details have changed be ready to walk away unless they give you what you agreed upon. Authorize the pull on your credit. Let the bank write up the agreement and make sure to read it in depth.

Many general contractors try and work their way around the tight regulations but these laws are strict and there have been many law suits in the past because people tried to bypass them. Safety should be everyone's #1 goal.




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